Category Archives: Current Events

Indignation of the Self-Righteous Self-Made

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There is an undercurrent of disatisfaction that is surfacing regarding the rescue of homeowners who got themselves into bad mortgage arrangements. Talking heads like the guy on CNBC are going off about how wrong it is that citizens who were more clever about their spending habits should have to pay for the mistakes of those who made bad choices.

As a first order approximation, it is hard to argue that we should line up to provide this payout.  If you make bad judgments based on greed, ignorance, or simple miscalculation, the theory is that in an ideal free market you should be free to suffer the consequences as well as the benefits.

That’s fine. Except that we do not have an ideal free market.  In this particular bust, the risks of mortgage trading were not accurately communicated to investors or even particularly well understood by anyone. The macro effect of a large number of mortgagees who are suddenly unable to deal with a large interest rate uptick in their adjustable rate mortgages (ARM) was under appreciated by most.

Adjustable rate mortgages and the subsequent investment instruments that followed were dreamed up by somebody- but probably not by hourly workers or anyone outside real estate and finance. There was a kind of wink-of-the-eye understanding between banks, mortgage brokers, builders, and the real estate business. Not only was there the invention of the ARM and the degradation of qualification standards, there was a nationwide marketing campaign aimed at marginal buyers. This real estate boom was financed in part by mortgage instruments designed to capture marginal borrowers.

The previous owner of the home that I presently occupy was a mortagage broker who had hit the big time at the start of this bubble.  After the signatures were on paper, he told his wife that she could have the BMW that she had wanted from the equity.  Mortgage brokering was practically a cottage industry and many people were making money.

Real estate agents knew this of course. They knew that easy qualification was available and they continued to do what they always do:  push buyers into the most home they could afford.  It was a sellers market and real estate speculation was rampant. Builders were routinely putting up spec homes and selling them like hotcakes.

This is not just a problem limited to greedy buyers. A whole business phenomenon grew into being around the housing boom. Lending institutions, mortgage brokers, real estate brokers, title companies, builders, and buyers all bought into a dream built upon sand. Buyers may have been guilty of bad judgement, but it was facilitated by entire industry ready and willing to make it happen.  

So, are the angry men we see on television justified in their assertion that they should not be forced to help bail out those facing foreclosure? I suppose the position you take depends on your vision of what civilization should look like. I think  if you investigate the self-righteous self-made, you’ll find that many of them benefitted in part by the distribution of wealth at some scale. Inheritance money, Pell grants, scholarships, good mentoring, good fortune, talented parenting, and many other forms of benefit that are not necessarily distributed by bank deposit. Simple hard work is rarely enough.

The parties involved in this fiasco should bear the brunt of it themselves to a large extent. That means that lending institutions should not be entitled to the profits they were anticipating and the borrowers should not be entitled to large equity on overvalued homes. There should be suffering on the part of all participants.

Edsel, Studebaker, and Saturn

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As that grand Zepplin of Corporations, General Motors, sinks like a deflating airship, it has begun to pitch everything overboard in a vain effort to stay afloat. It was inevitable then than underperforming assets would be unceremoniously dropped from service like a lame mule or an Oldsmobile.

Back in 1993 while living in South Bend, Indiana, I struck up a conversation with an elderly neighbor in my apartment complex. Turns out she was one of the last two employees of the Studebaker company. She and a coworker managed retirement benefits for Studebaker employees in a small office in South Bend for 17 years after the plant closed. On the last day, as she told the story, she and her colleague simultaneously walked out of the office and that was it for Studebaker.

And so it goes with Saturn. If the dealers cannot find a buyer for the manufacturing operation, they too will one day sell the last Saturn and close up the shop.  Parts manufacturers will continue to make parts for many years, but the Saturn will become synonymous with the dinosaur and the Dodo bird.

Djerassi-v-Trost. Clash of the Titans.

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The January 26, 2009 C&EN has an interesting letter to the editor. Carl Djerassi sent a letter critical of the manner in which Professor Trost cites authors in his references. According to Djerassi, Trost didn’t cite the discoverer of a natural product for which the Trost group had just reported a total synthesis. He took Trost to task in diluting the accomplishment of the workers who had isolated, characterized, and tested the compounds for biological activity by not citing the original work.

Trost’s treatment of Pettit is particularly egregious given the well-known fact in the chemical community that the spectacularly laborious decade-long efforts of one of the heroes of marine natural products chemistry—the person who personally collected the bryozoan, isolated the bryostatins, established their constitution, and pursued their anticancer activity against all odds—were terminated through a draconian closure of his laboratory by the new administrators of Arizona State University. [C&EN, Jan. 26, 2009]

Trost and Djerassi are two of the rock stars of organic chemistry. When such people “go nuclear” in their open personal criticism, it is so compelling that you can’t help but take notice. Far from being unseemly, I think this kind of thing is healthy for the field. Neglecting key early workers while trotting your own references up to the front of the line is a kind of misdemeanor racketeering of scholarship. If true, Djerassi has a good point.

But, I can sympathize with Trost to some extent. Eventually, past progress becomes part of the background. Do we have to cite Henry Gilman everytime we use BuLi to remove a proton? There must be some juicy backstory that has Djerassi riled.

Plea from China

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I don’t know what others are experiencing, but I am flooded with desperate email pitches from Chinese chemical manufacturers- “Please, let’s make cooperation!”  Everything from solvents to generic drugs.

A receding tide beaches all boats.

Update:  Just got an offer for bulk Vinblastine Sulfate. Golly, I think I’ll decline. The last thing a guy needs is a few kg of that stuff sitting in a cabinet.

Siccus Silicis. Oh yonder dessicated moon! Why dust thou taunt me?

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Big discovery. A few doors down at The Universe Today there is a report of findings showing that the moon is quite dry. This result is from an interpretation of radar soundings taken by the Japanese lunar probe SELENE.

Given the near proximity of the sun, and lack of any atmosphere, it would be astonishing that any water would be found on the moon, at least in the top few meters. Perhaps there are mineral hydrates in the regolith, but discrete surface water as ice or liquid in the shadows seems a bit of a stretch. Supposedly a trace of water was found by others near the polar regions where the sun angle is always low. 

Comets famously de-gas when they come near the sun. Maybe the moon was blowing a vapor trail too- 3 or 4 billion years ago.

The SELENE radar soundings were used to infer the presence of aqueous reservoirs well below the surface. The results failed to give any evidence of such bodies of water. Given the tumultuous history of the moon, as evidenced by the lava plains and impact activity it has experienced, there has been lots of opportunity for water to sublimate or cook off through fractures in the regolith in the past.

I like and appreciate the Universe Today site. But if I could offer some constructive criticism, they could do with more links to primary references rather than just recursive links to previous Universe Today articles. Actually, more than a few news sites do this.

On a side note, it is worth browsing the Japanese Space Agency (JAXA) website to get a feel for the depth of their program.

Dooleysquatt Schwartz and Schmuck PLC

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Looks like the major law firms in the USA are pitching staff overboard. These corporate Zepplins have hit hard times as the money dries up. According to Law Shucks, this year 2,289 people have been laid off from the top tier firms as of this posting. 

It’s prob’ly a good time to getcher self a cheap deevorce, seein’s how there oughtta be a bunch’a hungry attorneys scratchin’ in the gutters.

GOP setting up for a repeat of 1994

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It is interesting to watch the GOP setting up a 2010 slam dunk like a bunch of beach vollyball players. After the House Dems served the bail-out bill across the political net, the House GOP tapped the ball vertically to give the Senate a chance to scramble under it and slam it in the face of president Obama who’s standing next to the net, doe-eyed with optimism.

While Obama is making nice with the GOP by trying to be cooperative, the House Dems load the bill with goodies like ravenous college students load their scuffed melamine plates at an all-you-can-eat salad bar. To the delight of the GOP, they now have a plausibly deniable excuse for being uncooperative with the Obama administration. And the Housed Dems have served it up on a garnished platter.

The GOP leadership exclaims with alligator tears dripping onto their tailored suits, “How can we possibly accept the imposition of such tremendous debt on future generations of Americans? We believe, like Ronald Reagan, that tax cuts are the best stimulus for America.” Harumph, grunt, snort.

The Dem world view is to embrace new ideas and use government as a lever for doing good. The GOP world view is that government is bad, except for defense of property, and the economic Darwinism of the market should determine how civilization is shaped. Liberals tend to be eclectic and less focused on tangible goals. Conservatives tend to be doctrinaire and acquisitive. Obviously, there are exceptions.

President Obama is foolishly assuming that GOPers are just like Dems at heart. If only they could sup together they could find common ground. What the Obama Dems have failed to grasp is that the GOP wants to annex that common ground for their own new subdivision.

The GOP is plainly setting up for a turnaround in the upcoming 2010 midterm election. They are priming their huddled supporters for a campaign of  Limbaugh bile and Hannity disaffection with the Obama administration, in the same manner that Gingrich did in 1994 to the Clinton Administration by riling up the bible-belt like a nest of hornets.

The truth is that the GOP does not share the aspirations annunciated by the Obama Dems. The GOP leadership are more like Mongolian horsemen and the Dems are like a bunch of sod farmers. The only hope the sod farmers have is that the Mongolians will fall off their horses again.

It’s too painful to watch.

Buddy Holly

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I was a grubby little 18 month old Iowa farm toddler, eating dirt and tripping over cow pies when Buddy Holly, Ritchie Valens, and The Big Bopper augered into a frozen cornfield near Clear Lake, in northern Iowa. The date was February 3rd, 1959.

The pilot, 21 year old Roger Peterson, took off at 1 AM in light snow flying a 1947 Beechcraft Bonanza. A few minutes later, the aircraft impacted the ground at high speed a few miles from the airport, killing all aboard.  Tommy Allsup and Waylon Jennings, Holly’s backup musicians, were supposed to be on board the plane with Holly. But at the last minute they were pursuaded to give up their seats.

Last night, on the 50th anniversary of the untimely death of Buddy Holly, we went to a dinner theater production of the Buddy Holly Story. It turned out to be quite entertaining. I say “turned out” because in truth I’m not much of a 50’s music fan. Being a serial doofus in the area of music, I didn’t realize that Holly was such a prolific song writer. Wasn’t paying attention.

On a side note, a Beechcraft Bonanza has been flown underneath the Eiffel Tower. It is hard to imagine that permission was given, much less, an insurance policy.

Redoubt’s Rumbling Redux

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The Redoubt volcano along the Cook inlet in Alaska is showing seismic activity according to the Alaska Volcanic Observatory (AVO). Seismic activity may be a precursor to eruption. Dedicated seismic recorders show frequent bursts of activity on the volcano.  The USGS has a website with advice and information aimed at helping people cope with an ashfall. 

In the past, the prevailing winds have carried the ashfall in an easterly direction over and past Anchorage. According to AVO, Redoubt is a stratovolcano located several hundred km west of Anchorage. It has reportedly erupted explosively six times since 1778, with the most recent being in 1989-90.

Note to Wal-Mart:  You may want to stock up the anchorage stores with extra brooms and shopvacs.